Property sales fall to lowest level for a year

But an unexpected surge in interest from potential homebuyers in December
bodes well for the house market this year, estate agents said.

The typical number of house hunters registered per branch in December was 294, 32 more than the average figure for November, with viewings continuing right up until the Christmas break, the National Association of Estate Agents (NAEA) found.

The percentage of first-time buyers also rose to 21pc, continuing the increase since this section of the market hit its lowest proportion in nearly three years last autumn, although first-time buyers made up a quarter of the market during the same period last year.

Mike Poole, NAEA regional executive for the north sector, said: "Many members were kept busy right up to the Christmas break which bodes well for 2012.

"Sales were being agreed and a limited number of viewings were still booked in right up until the festivities began."

The increased interest from prospective buyers has yet to translate into purchases, with sales dropping off from six per branch in November to five in December, the lowest figure since December 2010 and in line with the expected seasonal slowdown.

Lenders are expected to tighten their credit criteria this year amid the weak economic backdrop, meaning borrowers could face a tougher time obtaining a mortgage, despite lenders recently expanding their ranges.

NAEA president Wendy Evans-Scott said: "It is pleasing to see that prospective house hunters remained determined to continue their search for a home despite the slowdown we normally expect to see at this busy time of the year.

"While this has not currently converted into actual sales, which were slightly lower than in previous months, I remain confident that this clear demand for property will be met with sensible pricing of homes by sellers in 2012."

The number of homes on the market also went down month-on-month, from 65 to 62 per branch, which the NAEA said reflected sellers' reluctance to put their houses up for sale until the new year.

Analysts have suggested the lack of homes on the market has created pent-up demand, with buyers undertaking meticulous research and reconsidering houses which they had previously discounted.

Martyn Baum, NAEA regional executive for the Midlands, said: "Due to the lack of available properties on the market there have been sales on stock which has lingered on the market for a number of months rather than the normal fresh instructions receiving the bulk of activity."